[Editor's Note: This question was submitted via email.]

Am I liable for a cashier’s check that might be forged if I did not know it was forged?

You are basically liable for any check that you endorse and/or deposit. Unfortunately, the number of counterfeit Cashier's Checks has escalated recently. Criminals take advantage of a federal law that requires banks to make funds from a deposited Cashier's Check available the next day (or least the first $5,000 available the next day.)

Many customers will simply ask their bank, "When will the money be available?" thinking it means the same thing as "When will the check be good." Having the money available does not mean that the check cannot come back. If you deposit a forged Cashier's Check and then spend or wire out the money (a common ploy that criminals will ask you to do), you are liable for the amount.

If you are concerned about a Cashier's Check, try calling the bank that issued the check to see if the item is legitimate. (Call the bank using a number you researched by Directory Assistance, the phone book, or a local branch of the issuing bank. NEVER use a number on the check itself!) If you are unable to do so, then you can deposit the check and wait at least two weeks before trying to use the funds.

If the check comes back any later than that, contact your bank to find out if the other bank returned the forgery in a timely manner. Generally speaking, a bank must return a forged check no later than midnight after the day the item was presented for payment. Given the various check processing times, it may take 2 to 5 days for the check to reach the other bank for payment, and another 2 to 5 days for returned check to come back to your bank.

If this is a situation where you have already wired the funds out, and it may cause an overdraft in your account, be sure to keep the lines of communication open with your bank. Even if you've lost a sizable sum of money, so still need to protect your credit and your good name. If necessary, ask your bank if you can make some type of payment arrangement, or if they could provide you with low-rate financing to get past this hurdle.